Alibaba and Coupang in the spotlight

ABSTRACT Alibaba and Coupang had enjoyed a period of success, starting with their IPOs. However, both companies have underperformed Amazon during the last 12 months. This special issue explores the underlying drivers for their tumultuous performance outcomes, including governance, political risks and internationalization strategies. This introduction paper sets the scene by studying the market perspective based on analyst reports, financial statements and stock market data. To understand growth expectations, we decompose current share prices into their present value, explained by current earnings and future value, driven by future growth and profitability. Exogenous factors such as the recent increase in interest rates, woes of governance problems associated with foreign corporations in South Korea and China’s anti-monopoly drive aimed at its tech giants have contributed to weaker performance. Our analysis of implied growth rates suggests that the market expects annual revenue growth above 11% for the foreseeable future. These expectations will be hard to meet, requiring a rethink of business models and processes.